Marketing Logistics, a research firm that monitors the direct marketing industry, reports that mail order sales of personal computers, consumer electronics and related products reached $1.5 billion in 1985. Business-to-business mail order sales for computer software and data processing supplies for the same year were $1.7 billion. The Direct Marketing Association, a trade group, reports that revenue from direct marketing for all product categories, now around $44 billion, is growing 10 percent a year—about twice as fast as retail.
Many businesses practice direct marketing by utilizing commercially-obtained mailing lists. These lists can be obtained from mailing list brokers such as BEST'S MAILING LIST, INC. or NATIONWIDE DATA SERVICES. Such mailing lists are typically compiled from various sources such as public real-estate documents, census bureaus, financial publications, and direct mail respondents. Members of the list, that is, people whose information is used to compile the list, typically consist of individuals who have provided information about their lifestyles and product usage through detailed surveys. For example, computer hardware or software purchasers that send in software and hardware vendor registration cards and surveys are typically placed on a mailing list geared towards the PC and technology industry.
Mailing list brokers exist and can supply a business with a multitude of lists from which to choose. Additionally, mailing list brokers can supply a business with lists of different formats, and try to accommodate the business's preferences. Alternatively, businesses can obtain personalized mailing lists geared towards their needs by consulting with a mailing list manager directly rather than going through a broker. The business then utilizes these mailing lists by sending out promotional items such as brochures, advertisements, or sale offers to persons included on the lists.
Businesses typically consider finding appropriate lists a problem. Also, skyrocketing paper prices and production expenses, as well as rising postage prices, have made it increasingly difficult to do cost-effective mailings. It is believed that the choice of mailing list is one of the most critical factors related to the success of a direct marketing campaign. This is because the best list can often result in ten times the response as the worst list for an identical mailing piece.
Unfortunately, approximately 40,000 different mailing lists exist that are available for rental today, making it difficult to pick the most appropriate list, and expensive to try multiple lists. Because of this, a business will typically purchase a mailing list without any indication of how successful the list will be for the business's particular purposes. Mailing lists are generally updated based on the responses of the individuals included on a mailing list. For example, if an individual on a mailing list has not responded to any mailings in the past year, he can be taken off the mailing list. In the meantime, however, businesses are purchasing mailing lists without being able to predict the number of responses to be expected from a given list. The most that a business or mailing list broker knows is the historical response rate of the individuals contained on the list to direct mailings of a general nature. There is no way for a business to judge just how effective a mailing list is for their particular product or service until the list is actually used.
Internet based mailing lists which include e-mail addresses for direct marketing are also becoming popular. This type of direct marketing offers several advantages over postal marketing. For example, e-mail campaigns can be set up and executed in a relatively short amount of time, and can begin to generate responses almost immediately. Also, it is possible to deliver several hundred thousand e-mails an hour and to easily track all phases of the status of delivery and response from a mailer's desktop. The impact of a direct marketing e-mail mailing is not nearly as high as that of a postal mailing, however. The postal mailing is a more tangible good in the prospective consumer's hand. Also a person is more likely to flip through a longer brochure at home than to click through one at their PC terminal. Thus, e-mail can be an excellent vehicle for relatively small brochures, but the postal mailing remains the most effective process for attracting the buying power of a consumer.
Thus, a need exists for a business to be able to efficiently and cost-effectively select an appropriate postal mailing list before investing a large amount of resources into utilizing the mailing list.